Poorly Built by Pulte No Different at Del Webb

Recommendations

Info

Tough Times for Pulte Homes The year 2008 will live in infamy for home builders. The Commerce Department reported another plunge in new home sales for December 2008, capping off the worst year since 1982. Bloomfield Hills, Michigan-based Pulte Homes Inc., builder of Pulte, Del Webb and DiVosta brand homes, reported that “slower sales, higher cancellation rates, and increased price discounts and sales incentives to attract buyers” contributed toward net losses in every quarter since the fourth quarter of 2006. The dismal housing market has taken a toll on Pulte’s bottom line. Pulte lost $2.3 billion in 2007 and the company reports an additional net loss of $1.5 billion in 2008. Many factors have contributed to Pulte’s financial woes, most outside of its control. However, Pulte bears responsibility for persistent reports of poor construction quality and unsatisfactory customer service. Based on our our surveys, Arizona, Nevada and California Pulte and Del Webb homeowners are dissatisfied with their homes and frustrated by the builder’s response to their issues. Investors and home buyers should consider whether Pulte’s self-inflicted damage will affect the reputation of its brands beyond any housing market rebound. 2
Pulte’s Junk Debt Isn’t the Only “Junk” The housing market has negatively impacted Pulte’s debt rating. Standard & Poor’s, Moody’s, and Fitch, three major credit rating agencies, unanimously rate Pulte’s debt as non-investment grade, better known as “junk.” A December 19, 2008 Fitch Ratings report stated how their downgrade of Pulte’s debt to junk status reflects negative trends in “operating margins, further deterioration in credit metrics ... and erosion in tangible net worth.” Credit raters aren’t the only ones giving Pulte a “junk” rating. “Pulte [filled in] the last half of the subdivision with junk 2x4 homes, destroying our home values. DO NOT TRUST PULTE.” Exposed nails in framing. Ridgemont Heights tract. Adelanto, California. August 8, 2008. - Pulte “Sheely Farms” homeowner, Phoenix, Arizona “I will never ever buy another Pulte home nor will I recommend them to my worst enemy!” - Pulte “Palm Hills” homeowner, Henderson, Nevada “I spent a lot of money on this house and I don’t know if it will last as long as I will. I don’t recommend Del Webb or Pulte to anyone.” - Del Webb “Solera at Kern Canyon” homeowner, Bakersfield, California Pulte home exterior. Fireside at Norterra tract. Phoenix, Arizona. September 22, 2008. 3
Page 1: Poorly Built by Pulte No Different
Page 5 and 6: 2008 Survey: 872 Arizona, Nevada an
Page 7 and 8: 44% Dissatisfied with Pulte’s Res
Page 9 and 10: A “Limited Warranty” ... with a
Page 11 and 12: American Dream, or Nightmare? “Th

Poorly Built by Pulte No Different at Del Webb

Create successful ePaper yourself

Delete template?

Save as template?